Nomura outbids rivals to buy Lehman's Asian operations

JAPAN'S NOMURA Holdings will buy the Asian operations of Lehman Brothers after outbidding rivals yesterday and also emerged as the front-runner to buy the bankrupt bank's businesses in Europe.

Nomura said it would buy Lehman's franchise in Asia Pacific, including Japan and Australia and 3,000 staff. It will pay up to $525 million for the business, according to a source familiar with the matter.

Nomura is also in talks to buy Lehman's business in Europe, three sources said. The administrators in Europe, PricewaterhouseCoopers (PwC), said they were in talks with one party regarding the investment banking and equities business, and a source familiar with the matter confirmed it was Nomura. Lehman has about 6,000 staff in Europe. Administrators and senior Lehman staff are working to save as many jobs and as much business as possible from the wreckage of what was Wall Street's fourth-biggest investment bank.

PwC said its discussions with one potential bidder in Europe "should result in a better deal for staff and creditors".

British bank Barclays, which last week bought Lehman's core US business, was interested in the European equities business but not all of the business, a source familiar with the matter said.

Lehman last week filed for bankruptcy protection after collapsing from its exposure to risky subprime mortgage securities. Barclays struck a $1.75 billion deal to rescue the US investment banking business, and signalled it might do the same for other units.

A deal for Lehman's investment management unit, which includes the crown jewel, Neuberger Berman, is still being hammered out. Private equity firms Bain Capital and Hellman Friedman have teamed up to bid for the assets, sources said. It was unclear whether other buyout firms such as Clayton, Dubilier Rice and KKR, who were originally pursuing the unit, were still interested.

Nomura's president and chief executive Kenichi Watanabe said the purchase in Asia marked "a transformational deal" that would harness Lehman's strong position in areas such as MA advisory.

"Our ability to capitalise on this opportunity in spite of such volatile markets reflects our financial strength and demonstrates how well we have managed the credit crisis," Mr Watanabe said. - ( Reuters, Bloomberg)